CLIENT PROFILE # 1

MGMT 3059 Case Study This case study is about Elizabeth Dubeau, a recently separated 40 year old woman . Elizabeth is employed as Marketing Manager for a growing tech company . Her salary is $85,000 annually. She has a 8 year old son, Sebastian, who lives with her in the house that she and her husband purchased when their son was 3. They paid $560,000 for the house with a down payment of 20% . 50% of this was an interest free loan from her father-in-law . The remainder was equally amounts from their RRSP's and gifts from both sets of parents . The house is located in Wortley Village and have just recently refinanced( Sept 1) for 80% of newly appraised value. The new mortgage amount is $560,000. The new mortgage is 5 year fixed rate @ 4.74% . They chose to take a fixed rate as the uncertainty of a variable rate mortgage concerned them. They were advised to take accelerated bi-weekly payments of $2169.83, they chose a 15 year amortization hoping to have the house paid when they were in their late 50's so they could travel. Property taxes are $10,000 per year , they deposit monthly to their mortgage account and the bank pays the taxes in their name and on time. This is additional and not part of their mortgage payment. They each have their own car, her husband Gabe's is a company car. Elizabeth drives a 2024 Qutlander PHEV (LE S-AWC). She purchased it last summer (June) because she was very concerned about climate change and wanted to do her part. She paid 52,000, (got $ 20,000) for her trade in ( a Mitsubishi Outlander ) and financed the remainder for a short term loan (she wanted it paid off as quickly as possible) Loan has a Bi-weekly payment of $ 661.28 at 7.15%. Additional monthly family expenses are listed below: Insurance-House-5130.00(Mortgage and house and Contents) Car-$150.00 (Elizabeth only) Life-$22.00 (Elizabeth only) Food-$2500 Utilities-$500.00(Hydro, Gas, Cable, Internet) Telephone-$100(Family Cell and Long Distance) Clothing-$500.00 Transportation Costs-$130 ( Monthly Parking Pass- Elizabeth only) Extracurricular for Sebastian - $295.00 Any credit cards are used for convenience and paid out monthly Elizabeth has an RRSP worth $25,000 invested in fixed term and a savings account with a balance of $5,000. Elizabeth has called to book an appointment with you as she would like to know where she stands should the separation move forward legally and eventually lead to divorce . Her friend has suggested that she contact your branch to discuss her options and find an adviser that she feels comfortable with . Elizbeth discussed this with her parents lawyer and the lawyer has forwarded this information to you. You need to take this information and organize it in such a way that you can begin to put together a client profile for Elizabeth. What questions would you like to ask in your first meeting? Remember that this meeting will be your first opportunity to get to know the woman that you may be dealing with. Think about this week's lecture -what is it important for you to uncover? Your Homework s Review the information that you have been given. How do you intend to proceed with this information? How will you create the profile and where will you begin? What format will the personal information take and what financial statements will you need to complete? Net worth and Cashflow? As of Jan 1,2025 Asyou work your way through the information you will become frustrated by what information is NOT there. This is the reality of the real world. If you have questions about this entry feel free to bring them with you to class You want to create a file for Elizabeth so that you have all of your 5 journals together in one place and with you in class. e Remember that these questions are your initial opportunity to build rapport with Elizabeth and to discover some of her goals moving forward. Keep track of them until you see her. e Your questions should be around getting to know and understand this woman and her situation they should not be financial questions at this point. You are building your image of the woman that you will meet for a first meeting in Weeks 6 and 7. Remember you are trying to build a relationship and gain trust. MGMT 3059 Profile #2 Entry #2 You have just gotten off of the phone with Elizabeth Dubeau and have had a very productive conversation. Elizabeth has been very clear as to her financial fears for the future and has asked for your help. Elizabeth has told you that she and Gabe do not seem to be able to find a way back to one another and so she needs to think about what she can do if she must move forward on her own. She needs to clearly understand what she can afford if she is living only on her own income. The lawyer is confident that she will be receiving at least $1250 per month in child support from Gabe, if they choose to share joint custody. At the moment they have a verbal agreement where Gabe takes Sebastian on Wednesday evenings from after school until 8:30 bedtime and every other weekend from after school Friday until 5 o'clock on Sunday evening. Gabe is still contributing to the household financially as he did, but should this become a legal separation a more official financial arrangement will need to be agreed upon. Elizabeth has her car with the associated debt and expenses. Elizabeth needs to understand what her housing options are. Could she afford to buy out her husband's portion of the house (she loves her home and likes the continuity for Sebastian). Would it be more financially sound to have Gabe buy her out or should they sell the house and split whatever equity dollars they receive. In any case if she ends up not staying in the house herself then she needs to know if buying another house is an option or if she needs to look at renting. Elizabeth has asked and you have agreed to have some advice and the related choices ready for her next week when you will telephone conference with her to give her your conclusions for her immediate financial problems. You need to work out what Elizabeth can afford and make your appropriate suggestions to help her to move forward once the separation is finalized. | suggest that you start with her financial statements and move forward from there. Look at her Net Worth, Income Statement and Projected Budget(as best you can), these will help you to formalize and explain your suggestions to Elizabeth. Remember that you have to be a detective with the numbers - what do they tell you? We discussed the initial statements in class before you received Profile #2 so certain things should be clear. What are the options (there should be 3) as far as the house is concerned? 2. Given certain choices for question 1 what are Elizabeth's housing options and how does each choice leave her financially? 3. Arethere other items in her statements that could be addressed to help with her cash flow? MGMT 3059 Client Profile - Part 3 You have just finished your telephone meeting with Elizabeth, who was very appreciative of your advice. She realizes that some changes may need to be made and is willing to make the adjustments necessary. You should have by now figured out her net income and adjusted her housing expenses as per your suggestion. Your suggestion, at this point, is that you look at Elizabeth' tax and insurance positions and return to her in a week with your suggestions. You feel that she needs to be confident that she is appropriately insured and that she is minimizing her personal tax position as best she can. Always keeping in mind her disposable cash. What personal products should she have to help minimize her personal tax position? Sebastian is 8 would an RESP be something to think about? TFSA? RRSP? What insurances would you recommend keeping in mind the budget and income statement that you have for her? She has some life - what kind do you think and how much ( you can figure this out). Is it enough? Should she have disability insurance or is it supplied by her company? This week submit your suggestions for both insurance and tax efficient products with reasoning to the Submission Folder before Sunday midnight. MGMT 3059 Client Profile - Part 4 You have now been working with Elizabeth for a few weeks and she is quite happy and confident that she is moving in the right direction. She has taken your advice, where necessary, to free up her cashflow. This week you explained the necessity of certain types of insurance. You have also explained how she can become more personally tax efficient. Since you feel confident that Elizabeth is in a fairly good position to move forward you have asked her to tell you what areas of concern financially she has and given your discussions and based on certain criteria, you have discerned that she is of a moderate risk level. Given this new information you will work this week on putting a plan in place to firstly see if her areas of concern can be put into SMART goals for her future , if they cannot in some cases then what information do you need to ask to enable you to do so. Secondly you may have to continue reassessing Elizabeth's proposed budget to ensure enough discretionary money to begin working toward these goals or concerns. Elizabeth's Fi ial Goal 1. Elizabeth would like to take Sebastian on at least one good holiday each year. It doesn't need to be in the summer as her parent take care of that but March break seems like a nice idea to her. 2. Tostart saving to pay for education . She knows that Huxley is only 8 but she thinks that they should start and Gabe is willing to look at contributing to this as well. 3. She knows retirement is something you need to plan for . However she feels like that is not as big a priority right now as everything else. That being said she does have strong ideas around retirement. Elizabeth's Risk Tolerance Since you are assuming a moderate risk tolerance. She usually gets a bonus each year based on her performance (always a good evaluation) and the bonus has been about 10% of her gross salary . That performance appraisal also is the grounds for a raise each year which has been about 5% annually . She has some benefits at work (health and some short term disability) . There is a small (defined contribution, she contributes 5% of her gross salary only and the company matches) company pension. You should make sure that you state all goals in SMART terms and that you consider the financial service products that would be best used to further these goals. Your final Projected Budget should show income less fixed expenses and variable expenses (all) leaving discretionary income for use in working toward her SMART goals. You should include the Proposed Net Worth and Proposed Budget with your Planning Report if you want me to check it for you. This is your final Client Profile Entry - What questions do you have? Your 1st presentation is in Weeks 6 and 7 . how will you use the Chapter 6 questioning sequence as you prepare for your first meeting? This week - just submit her SMART goals (as best you can) to the Submission Folder before Sunday midnight. Trying to write these goals in SMART terminology should give you more questions for yourAssignment Instructions Complete the following questions to work your way through the prep work required to successfully complete your Presentation #1 "The First Meeting" 1. What are your objectives for the sales presentation? Be specific and detailed. Please have 3 SMART (specific, measurable, action oriented and attainable, realistic and relevant, timed) objectives for yourself for this meeting. 2. What are your client's key motivators? How will you address these key motivators when related to this product which you are addressing as an immediate need? 3. How will you introduce yourself? 4. What will you rapport builder be about ? Think of areas that could provide common ground , given what you know from the profiles, between you and your client. 5. What questions will you have for your client? How will you ask them and what information are your hoping to get from them? Are you making the most of the Questioning Sequence (Chapter 6) Information questions uncovering the current situation, analytical questions uncovering the desired future situation and feeling questions that allow the client to see the gap between the current situation and the desired future situation. 6.How will you transition from your rapport into your questioning sequence( Information questions) . Use your rapport to lead you to the area of immediate need and from your questioning sequence (Feeling questions), the feeling questions themselves should be the transition allowing you to give a short product overview of your assigned product. 7. How will your short product overview lead you to asking for a second appointment